KNOXVILLE, Tenn. — Tis' the season for shopping, and over-swiping. It's the time of the year when credit cards become the most common way to pay. The Better Business Bureau said that about four in 10 people go into debt every year during the holidays.
Felix Harris with the Knoxville Area Urban League has what you need to know to be a more conscious shopper this season.
Should I have a budget?
Yes. Harris' biggest saving advice is to approach your holiday shopping with a plan. He says having a business plan and strictly following it will limit how much you spend. A budget will help you avoid spending money you don't have.
Credit Card or Cash?
When purchasing loved ones some gifts, Harris advises staying away from credit cards and leaning more toward using cash. He says using credit cards is a big mistake he sees people commonly use. Cash will limit your spending, while credit will encourage you to borrow money to buy gifts that you would need to pay for over the next years.
When should I start buying gifts?
According to Harris, the earlier the better. Early Christmas shopping will help you mail out gifts on time. If you like to shop from the comfort of your home, you want to pay close attention to mail carrier shipping deadlines. If you wait until the last minute, you'll have to pay up extra for overnight or rush shipping.
How much should I have in my savings account?
After all the shopping is done, Harris advises building up at least three to six months' worth of your expenses in your savings for emergencies. He says having saved six months' worth of monthly expenses will help you when January and February come.
How to start saving for the holidays in 2023?
Harris says people should start preparing for end-of-the-year spending at the start of the new year. Creating a "Christmas" or "gifts" bank account in January will allow you to slowly add a portion of funds throughout the year into the account. Saving $25 a month will add up to $300 by December.
For more tips on how to shop smart, the Better Business Bureau has more information on how to plan your holiday budget.